The cost of credit has risen across Europeas a result of the downturn adding to the pressure on cash strapped channelfirms looking for finance.
There have been numerous calls for the banks not only toincrease their lending but also to do so at realistic rates from the likes ofthe Forum of Private Business (FPB) but research from Siemens Financial Services(SFS) shows that problems persist.
In a survey of firms in the UK, Germany and France thefeedback covering the first quarter was that borrowing had not only become moreexpensive but 50% of British businesses revealed they had seen their creditlines reduced by banks.
In the UK68% of companies expected further credit caps this year and 74% predicted arise in the cost of credit.
Derek Ryan, sales director at SFS, said that the indicationswere that the squeeze on credit would continue.